India’s information technology industry is set to cross the $300 billion revenue mark for the first time, according to industry body National Association of Software and Services Companies (Nasscom), even as artificial intelligence reshapes traditional service models.
The sector is projected to grow 5.1% in FY25, reaching $282.6 billion in revenue, supported by easing tariff and trade tensions and rising investments in AI-driven solutions. Nasscom expects the industry to expand 6.1% year-on-year to approximately $315 billion in the fiscal year ending March 31, with similar growth anticipated in the following year.
Speaking at the Nasscom Technology Leadership Forum, Nasscom President Rajesh Nambiar described the FY25 performance as a positive outcome given global uncertainties. The industry added 126,000 new jobs during the year, taking total employment to 5.8 million. Overall, net hiring is expected to reach 135,000, pushing the workforce to nearly 5.95 million.
Despite volatility in Indian tech stocks amid concerns that AI could disrupt traditional outsourcing models, industry leaders remain optimistic. They highlight stronger global outsourcing demand, robust deal pipelines, and rapid adoption of AI-enabled services as key growth drivers. Nasscom Vice Chairperson Srikanth Velamakanni noted that while AI is compressing certain traditional work streams, it is simultaneously expanding new areas of opportunity, making AI integration fundamental to virtually every technology proposal worldwide.
Segment-wise, traditional IT services are forecast to grow 4.3% to $137.1 billion in FY25, while business process outsourcing (BPO) is expected to rise 4.7% to $54.6 billion. Engineering research and development (ER&D) is projected to be the fastest-growing segment, expanding 7% to $55.6 billion.
Major Indian IT firms including Tata Consultancy Services, Infosys and HCLTech have expressed confidence in improved demand conditions in the next fiscal year.
